Schizophrenia presents in a variety of ways and leads to a variety of outcomes. Of relevance to this heterogeneity is the overlapping boundary between schizophrenia and affective disorder. Some schizophrenic patients manifest symptomatology and natural course similar to affective disorders. There is some evidence for an excess of affective disorder among the relatives of schizophrenic patients. Rapid eye movement (REM) sleep latency, considered to be a consistent biological marker for affective disorder, is also seen in some patients with schizophrenia. In this study, it is hypothesized that schizophrenic patients with shortened REM latency will have more frequent family histories of affective disorders as well as a more favorable therapeutic response to lithium and neuroleptics, a recurrent course, and less residual symptomatology between episodes. Polysomnographic studies will be performed in consecutive drug-free patients with DSM-III-R schizophrenia and schizophreniform disorders. The family study method to ascertain psychiatric morbidity in first degrees relatives will be used. Patients will be longitudinally evaluated with psychopathological ratings weekly during the initial treatment with lithium (2 weeks) and neuroleptics (4 weeks) and then periodically up to 2 years during standard neuroleptic maintenance treatment. The psychiatric morbidity among the family members of the subgroups of these patients with and without shortened REM latency will be compared. The therapeutic response to lithium and neuroleptics and the course of the disorder in these groups will also be compared. The relationships between other sleep parameters (e.g., REM density, NON-REM sleep) family history and outcome measures, will also be explored.